IndiGo to Layoff 10% of Workforce

IndiGo, one of the largest airlines in India, has announced that it will layoff 10% of its workforce.

The ongoing COVID19 pandemic has impacted many industries around the world, amongst which aviation has been one of the sectors that has been impacted the hardest.

Even now, with some travel restrictions around the globe being gradually eased, IndiGo is only flying a small percentage of its full fleet of 250 airplanes.

The airline employs around 24,000 people.

In a statement issued on Tuesday, Ronojoy Dutta, CEO, IndiGo, said, "Right at the start of this crisis, IndiGo understood the gravity of the situation. For us, it was critical to minimise the impact of the pandemic on our employees and in fact IndiGo was one of the few airlines globally which paid full salaries for the month of March and April 2020, despite the disruption in business. Subsequently, we did have to undertake a number of measures such as pay cuts, leave without pay and various other costs; but unfortunately, these cost savings are clearly not enough to offset the decline in revenues. And from where things stand currently, it is impossible for our company to fly through this economic storm without making some sacrifices, in order to sustain our business operations. Therefore, after carefully assessing and reviewing all possible scenarios, it is clear that we will need to bid a painful adieu to 10 per cent of our workforce. It is for the first time in the history of IndiGo that we have undertaken such a painful measure. This is indeed a very unfortunate turn of events from the optimistic growth trajectory we had carved out for ourselves just six months ago; but this pandemic has forced us to re-evaluate our best laid plans."

In an attempt to try and help the impacted employees, the airline has said that it will:

Notice Pay in lieu: Impacted employees will be paid notice pay in lieu of serving notice applicable to them. This will be calculated on the gross salary, basis the employee’s notice period.

Severance Payment: In addition to notice pay, impacted employees will be paid a severance pay which will be calculated as one month of CTC for every completed year of service, subject to a maximum of 12 months. This will lead to higher cash in hand in comparison to calculations on gross salary. At a minimum, an impacted employee will receive at least 3-months’ gross salary, including both the above payments.

Annual Bonus / Performance Linked Incentive (PLI) (for Non- crew), FY 2019 – 20: Payment of bonus / PLI shall be made when the company decides to make this pay-out to the rest of the employees in this financial year, even after the impacted employee’s exit.

Longevity Bonus (Crew): For year 2020, longevity bonus shall be paid to eligible crew members. This bonus is only applicable for cabin crews.

Medical Insurance: Coverage for impacted employees will be extended until December 2020. There shall also be a provision to continue with the policy post December 2020 as per applicable market rates. For those employees who had covered their parents via the policy, such insurance will also be extended until December 2020. As is currently existing, payment will be borne by the employees.

In addition to other forms of support, the airline has said that it will also offer impacted employees with a one way confirmed air ticket should they need to travel back to their hometown or base location.

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